Sadafco launches IPO

The Saudi milk and dairy products specialist is selling off 30% of its shares and listing on the stock market.

  • E-Mail
By  David Ingham Published  April 16, 2005

The Saudi Dairy and Foodstuff Company (Sadafco) will soon sell 30% of its equity in an IPO open to Saudi investors. The offering starts on April 25 and will run until May 4, with 1.95 million shares up for grabs at SR260 each. “The initial public offering (IPO) of Sadafco shares provides an opportunity for Saudi investors to share in the success of a company that has a solid track record of growth year after year,” said Ahmed Mohammed Hamid Al-Marzouki, managing director of Sadafco. “SADAFCO has solid business prospects and is strongly positioned in growth markets such as dairy and juice products, and tomato paste,” said Al-Marzouki. National Commercial Bank (NCB) is lead manager, underwriter and financial adviser for the IPO, which values Sadafco at around US $450 million. 10% of the IPO allocation is reserved for institutional investors with the remaining 90%, or 1,755,000 shares, kept for individuals. The shares on offer are being sold by stakeholders in the company, so none of the IPO proceeds will come back to Sadafco. Nevertheless, Al-Marzouki says the listing is beneficial because it will raise Sadafco's profile and allow the company to use the market to raise funds in the future. Sadafco employs over 2,000 people and is currently reducing costs by consolidating manufacturing at two locations in Jeddah and Dammam. United Industries Company, Sadafco’s largest shareholder, has said it will retain a 40% stake in the company after it is listed.

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code